Central Bank of Nigeria’s intervention to rejuvenate the power sector in the country is expected to amount to N120 billion to address the problems of volatility and lack of funds that are plaguing the industry. The action was taken at the same time as Ahmed Zakari, who is currently the Special Advisor to the Nigerian President on matters of Infrastructure, had confirmed that the Federal Government had been speeding up the process of disbursement of a CAPEX of 120 billion in Nigerian currency to overhaul and strengthen the system. The bank’s funding will be equally distributed among companies that generate electric power (GENCOs), the DISCOs or the companies in charge of distribution of electricity and meter program maintenance, and the other organizations that provide service and gas.
However, the CBN has recently modified its policy on the rates of exchange to bring a balance. It has removed the official exchange mark of 379 Nigerian currencies per one dollar from its site. Instead, it has implemented the recent Nigerian Autonomous Foreign Exchange Rate, or NAFEX, also known as the Forex Window, rated at N410.20. Hence, the Federal Government’s plan for introducing one million meters under the National Mass Metering Programme (NNMP) will be sponsored by the Central Bank.
The Federal Government has tried to achieve the mass installation of meters at the homes of Nigerians under NNMP. For this, it has sanctioned loans to the Distribution Companies and the small-scale producers of meters at the local level to manufacture and assemble meters.
Despite the funding, one cannot overlook the major problems that afflict the sector, such as the red tape at customs clearing and the pandemic-induced disruption in electricity supply across the globe.